One day, Russell Willis Taylor, the President and CEO of National Arts Strategies told me this: “Many towns look alike. There is a Starbucks at every corner. There is a Walmart in every town. But you know where you are by the art that is being enjoyed and created — that is what gives us that important sense of place now.” Urban Arts entrepreneur Matthew Kwatinetz definitely agrees, adding that “The culture of a city is an expression of that community’s identity, what matters to them.” Matthew continues, saying that “ today we know that arts and culture also have significant economic impacts, and cutting funding for the arts can also negatively impact local businesses, amplifying the financial woes of already strained communities.”

Matthew is part of a new breed of business innovators that I call urban arts entrepreneurs. This group combines fervent advocacy for the arts and passionate community activism with a strong business sense; they dedicate their lives to impacting specific urban geographies, bootstrapping complex partnerships between heterogeneous entities – local government officials, businesses, institutions, financiers, artists, arts organizations, community organizers, and influencers of all types. Just like most entrepreneurs, urban arts entrepreneurs start with limited resources, and create a “product” for people to enjoy or a service that serves a specific need. It’s a huge task, and given that they can’t afford an armada of employees, urban arts entrepreneurs must wear multiple hats and show an exceptionally broad spectrum of competencies. The minute you get that, you won’t be surprised by the amazing complexity of their personal trajectory.

The making of an urban arts entrepreneur such as Matthew is by no means a linear process. It starts with a deep love for the arts and personal artistic talent. Matthew was classically trained in trombone and voice, went into musical theater and performed with high level amateurs and semi-professional troupes starting at a young age. Such experience as a practitioner is a plus if you want to directly or indirectly manage artists — individual contributors with their own strong ideas. Now, managing people requires more than just empathy. You also need leadership, a natural talent that Matthew had, yet was considerably strengthened at a college of his own choice, Deep Springs College, a small organization whose goal is to prepare its male students for “a life of service.” You also need a serious cultural and liberal arts background, something that Matthew acquired at Harvard where he selected to major in philosophy – while remaining very active as an artist.

Where do you go from there? Matthew decided to move from the East Coast to Seattle, with two goals in mind: land a day job and pursue his performance work. And he did both. His day job was at Microsoft, as a Program Manager for embedded systems (incidentally, Matthew’s hobby since he was a kid was to write code…), and he continued to work both as an artist and as a production coordinator and consultant to arts organizations… Until he felt frustrated as he kept on witnessing arts organizations facing the same structural problems over and over again. So he decided to create a business incubator for arts and entertainment groups, uniting his passion for business and the arts. He started the Capitol Hill Arts Center (CHAC) on 12th Avenue in Seattle in 2002, that provided a common infrastructure — “like an operating system,” Matthew adds — where people were able to share space, personnel and other commonly needed resources to lower overall costs, creating efficiencies of scale by satisfying the needs of several small organizations with a shared infrastructure. The organization presented hundreds of shows of all types in the course of the six years of its existence.

The creative economy: Arts in the City make businesses thrive

Capitol Hill Arts Center was a success. The biggest problem the organization ended up encountering is that it didn’t own its building, which placed it in a strange paradox. The existence of Capitol Hill Arts Center had changed the surrounding real estate, making it more desirable, evidenced by private developers advertising CHAC as a perk in their marketing pitch to sell commercial real estate. But when CHAC was offered an opportunity to extend its lease, Matthew tried to purchase the building to capture some of this value—but the owner of the building didn’t want to sell. That’s when Matthew realized that as an urban arts entrepreneur, he was, in reality, in the real estate business, and that the model of CHAC could be extended to be relevant for public policy making and neighborhood real estate development. There was a paradox: while arts businesses are not large money-making operations, they create opportunities for other businesses around them to make money based on their work, and public support.

This conundrum spurred him to work with the County’s cultural development organization to rally a large movement of artists, real estate developers, lawyers, companies and business owners to show up at City Hall demanding that the City start thinking of the development of the arts, entertainment and culture in a different way. At the request of Seattle’s City Council, Matthew helped form an advisory committee on urban planning and cultural districts. “It had become clear to me,” Matthew adds, “that understanding the relationship between the private and the public sectors was key, and we had to demonstrate that investment from the public sector leads to an increase in value on the private side. In this situation it becomes the responsibility of local government to channel this increased value into the public good.” While Matthew had experimented in many different industries and businesses, he commented wryly to me: “It also became obvious to me that I needed to get an MBA to learn what other people already knew about this economic relationship and what I could learn from them.”

As a result, Matthew graduated with honors from The Wharton School last May with an MBA in Real Estate and Finance, and has started his new company, QBL Real Estate. The name may sound like a cabbalistic file extension, but its purpose is to focus on the needs of arts/entertainment organizations, artists and cultural/community space developers as well as the role of the arts in enlivening business districts and revitalizing neighborhoods. His clients include, among others, the City of Ottawa, the City of Austin, the Kimmel Center of the Performing Arts (Philadelphia) and King County’s Cultural Development Authority. In the video below (about 40 minutes – Matthew being introduced after 6 minutes), he discusses the quantifiable impact of culture on the value of private real estate and the positive outcomes for communities at large.

What is remarkable about this video to me is how Matthew translates his unique perspective on the role of the arts into a prescription for downtown urban development as a whole — arts-related or not. He is able to apply principles from economics, geo-spatial theory, business strategy, creative economy and other diverse fields. To me, this is Matthew’s true value-add, and that of many entrepreneurs: they are synthesizers.

Cities and neighborhood can benefit from the holistic approach that Matthew brings, as well as his passion and determination to solve the recurring question of the role of the Arts and culture in our society. A brilliant speaker about the role of culture in downtown business districts, real estate financial models, cultural economic development policies and the changing face of corporate philanthropy, Matthew is also hands-on as a consultant. Ultimately, he believes that the social value of public goods such as schools, parks and (of course) cultural institutions cause a corresponding increase in surrounding real estate prices. It is clear after talking with him that culture will be a key part of future urban economic development practice, as well as an essential tool for the savviest real estate developers to positively impact communities both socially and economically.

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[…] This post was mentioned on Twitter by Dr Sam Chandan, Matthew Kwatinetz. Matthew Kwatinetz said: I've just been profiled by Maryelene Delbourg-Delphis in her "Grade A Entrepreneurs" blog…check it out: http://t.co/X0bBqov […]

You are completely right, Guillaume, and that you for reminding me of this great post you wrote a year ago about the Singing-Ringing Tree sculpture in Burnley, Lancashire, UK. You were also right to quote Douglas Rushkoff’s Life Inc. The Vatican did not build the cathedrals. The funds came from local currencies, i.e. the value created by the towns themselves.